The Toyota Way: T O Y O T A

14 Management Principles
for Quality and Excellence
The Toyota Way
TOYOTA = The One You Only Trust , Always
Excellence unLimited, Rajkot

1
In the current Global meltdown scenario,
Darwinian Principle of Survival of the fittest
will prevail.
If you want to survive and grow,

You have to be fit !

2
Adoption of best Management practices
will make you fit and a winner !

3
bout Toyota Motor Corporation
Established in Japan in Year 1937,

Largest and most profitable automobile
manufacturer in the world since 2008,
produced 20 crore vehicles till July 2012 (means ?)
About 70 different vehicle models,
Largest listed company in Japan,
14th largest listed company world over,
Factories in 27 countries in the world,
Over 3,33,498 employees world over,
Following Best Management Practices since 1940

4
bout Book The Toyota Way
Though Toyota is practicing Best Practices since

1940, it defined them in 2001, terming it as
The Toyota Way .
Michigan University professor Dr. Jeffrey Liker
presented it to the world as book The Toyota Way
in 2004

5
Toyota Motor Corporation
Automobile industry is in turmoil world over.

Recent news is that GM, Ford and Chrysler in USA
are in deep financial trouble, while Toyota is less
affected, thanks to its Management practices .

6
The Toyota Way
Also known as Lean / Flexible Manufacturing

or Toyota Production System ( TPS also
called Thinking Persons System ) is
responsible for tremendous success of the
company. Ideas invented in 1940s are still
relevant, universal, and equally applicable to
Service sector as well.

7
Toyota Way
The principles are no rocket science and are easy
to understand and put them in practice to become and
remain fit.
These principles are organized under four sections. ( 4 P )
Section 1 : Long Term Philosophy
Section 2 : The Right Process will Produce the Right

Results
Section 3 : Add Value to Your Organization by

Developing Your People and Your Partners
Section 4 : Continuously Solving Root Problems to

drive
the Organizational Learning
8
4 P Model of Toyota Way
Problem
Solving
People & Partners

Most organizations ( Respect, Challenge,
are here Grow )
Process
Process
((Eliminating
EliminatingWaste
Waste))
Philosophy
( Long term Thinking )
9
4 P and 14 Management Principles
3 underlying cultural values are Continuous improvement, Respect and Teamwork

10
Toyota Way
Section 1 : Long Term Philosophy
Principle 1 : Base your management

decisions
on a long-term philosophy,
even at
People need purpose to find motivation and
the expense of short-term
establish goals.
Toolsgoals.
to establish Long Term Philosophy are

SWOT Analysis,
Formulating Vision, Mission and Values,
Formulate Strategic Plan and deploy it by
establishing goals and targets for each
level of
employees, from Chairman to Watchman.
11
Toyota Way
Section 2 : The Right Process Will produce

the Right Results
Principle 2
Create a continuous process flow to bring

problems to the surface.
Work processes are redesigned to eliminate
waste through the process of continuous
improvement - Kaizen.
Customers are willing to pay for Products /

Services and not for waste.
(Waste consists of material, money, man,
method, time)
12
Toyota Way
Principle 3
Use "pull" systems ( Just in Time or Kanban )

to avoid over production / delivery
This helps achieve optimum use of resources,

reduce inventories and free workspace of
clutter.

13
Toyota Way
Principle 4
Level out the workload
This helps achieve the goal of minimizing waste ,

not overburdening people or the equipment /
system and
not creating uneven output.

14
Toyota Way
Principle 5
Build a culture of stopping to fix problems, to

get quality right the first time and every time.
Quality is given utmost importance. Any

employee has the authority to stop the process
to signal a quality issue.

15
Toyota Way
Principle 6
Standardized tasks and processes are the

foundation for continuous improvement and
employee empowerment.
Its implementation allow for continuous

improvement (kaizen) from the people involved
in the system. It empowers the employee to aid
in the growth and improvement of the company.
Tools : SOP, Work Instructions, ISO 9001 or like

documents and systems.

16
Toyota Way
Principle 7
Use visual control to surface the problems out.
Included in this principle is the 5S Program - steps that
are used to make all work spaces efficient and
productive, reduce time looking for needed items and
improve the work environment.
SEIRI = Sort ,
SEITON = Set in Order ,
SEISO = Shine / sweep

SEIKETSU = Standardize ,
SHITSUKE = Sustain the gains .

/
17
Toyota Way
Principle 8
Use only reliable, thoroughly tested technology

that serves your people and processes.
Technology is pulled by process, not pushed to

process.
Do not introduce technology just for hack of it.

18
Toyota Way
Section 3 : Add Value to the Organization by

Developing Your People and Partners
Principle 9
Grow leaders who thoroughly understand the

work, live the philosophy, and teach it to
others.
Without walking the talk, the principles will
fade. The principles have to be ingrained.
Employees must be educated and trained
because they have to create and maintain a
learning organization. Challenge their
capabilities to bring them out of their comfort
zone.
19
Toyota Way
Section 3 : Add Value to the Organization by

Developing Your People and Partners
Challenging people to bring them out of their
comfort zone.

20
Toyota Way
Principle 10
Develop exceptional people and teams who follow your

company's philosophy.
Teams should consist of 4 - 5 people and should

represent all levels of management tiers and
be cross functional. Success is based on the
team, not on the individual.
TEAM = Together Everyone Achieves More
All of us is better than anyone of

us
21
Toyota Way
Principle 11
Respect your extended network of partners and

suppliers by challenging them and helping them
improve.
Treat your suppliers much like you treat your
employees, challenge them to do better and
help them to achieve it. Provide cross
functional teams to help suppliers discover and
fix problems so that they can become a
stronger, better supplier.
Trend is towards keeping only a few select

suppliers.
22
Toyota Way
Section 4 : Continuously Solving Root Problems Drives

Organizational Learning
Principle 12
Go and see for yourself to thoroughly

understand the situation
Managers are expected to "go-and-see"
operations.
Philosophy MBWA = Management By Walking
Around.
Without experiencing the situation first hand,
managers will not have an understanding how
it can be improved.

23
Toyota Way
Principle 13
Make decisions slowly by consensus, thoroughly

considering all options; implement decisions rapidly
While deciding major things, keep every one

in the process, take their opinion, consider all
options and decide. Everybody will cooperate
to implement the consensus decision.
Once decided, implement the decisions

without loss of time.

24
Toyota Way
Principle 14
Become a learning organization through

relentless reviews and continuous improvement
The process of becoming a learning

organization involves critical review of every
aspect of what one does ( Organization and
individuals ).
Tools : Kaizen, Organizational Score Card and
individual goals and targets

25
Toyota
Way
Continuous Implementation of all these 14

principles distributed under 4 P
( Philosophy, Process, People & Partners,

Problem Solving )
lends an unbeatable edge to any organization,

whether in
Manufacturing or Service Sector.
Resolve to follow them relentlessly and success is

yours.

26
Any Questions ??
27
I will be happy to help you in this
journey.
Just call : +91-99250 28020

or e-mail
dkk25945@hotmail.com
28
Thank
You

29

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14 Management Principles

for Quality and Excellence

The Toyota Way

TOYOTA = The One You Only Trust , Always

Excellence unLimited, Rajkot

If you want to survive and grow,

Excellence unLimited, Rajkot

Excellence unLimited, Rajkot

Established in Japan in Year 1937,

Excellence unLimited, Rajkot

Though Toyota is practicing Best Practices since

Excellence unLimited, Rajkot

Automobile industry is in turmoil world over.

Excellence unLimited, Rajkot

Also known as Lean / Flexible Manufacturing

Excellence unLimited, Rajkot

Section 1 : Long Term Philosophy

Section 2 : The Right Process will Produce the Right

Section 3 : Add Value to Your Organization by

Section 4 : Continuously Solving Root Problems to

People & Partners

3 underlying cultural values are Continuous improvement, Respect and Teamwork

Excellence unLimited, Rajkot

Principle 1 : Base your management

Section 2 : The Right Process Will produce

Create a continuous process flow to bring

Customers are willing to pay for Products /

Use "pull" systems ( Just in Time or Kanban )

This helps achieve optimum use of resources,

Excellence unLimited, Rajkot

Level out the workload

This helps achieve the goal of minimizing waste ,

Excellence unLimited, Rajkot

Build a culture of stopping to fix problems, to

Quality is given utmost importance. Any

Excellence unLimited, Rajkot

Standardized tasks and processes are the

Its implementation allow for continuous

Tools : SOP, Work Instructions, ISO 9001 or like

Excellence unLimited, Rajkot

SEITON = Set in Order ,

SEISO = Shine / sweep

SHITSUKE = Sustain the gains .

Use only reliable, thoroughly tested technology

Technology is pulled by process, not pushed to

Excellence unLimited, Rajkot

Section 3 : Add Value to the Organization by

Grow leaders who thoroughly understand the

Section 3 : Add Value to the Organization by

Excellence unLimited, Rajkot

Develop exceptional people and teams who follow your

Teams should consist of 4 - 5 people and should

All of us is better than anyone of

Respect your extended network of partners and

Trend is towards keeping only a few select

Section 4 : Continuously Solving Root Problems Drives

Go and see for yourself to thoroughly

Excellence unLimited, Rajkot

Make decisions slowly by consensus, thoroughly

While deciding major things, keep every one

Once decided, implement the decisions

Excellence unLimited, Rajkot